Darwins Mind:

The evolutionary foundations of heuristics and biases

James Montier

Dec 2002

Working Paper : Please do not cite without permission

Comments Very Welcome

Email: James.Montier@drkw.com
Abstract:

The catalogue of biases that cognitive psychologists have built up over the
last three decades seem to have stem from one of three roots – self-
deception, heuristic simplification (including affect), and social interaction.
This paper attempts to explore the evolutionary basis of each of these roots.
The simple truth is that we aren’t adapted to face the world as it is today. We
evolved in a very different environment, and it is that ancestral evolutionary
environment that governs the way in which we think and feel. We can learn to
push our minds into alternative ways of thinking, but it isn’t easy as we have
to overcome the limits to learning posed by self-deception. In addition, we
need to practice the reframing of data into more evolutionary familiar forms if
we are to process it correctly.

Key words: heuristics, biases, rationality, evolutionary psychology

DARWINS MIND:
THE EVOLUTIONARY FOUNDATIONS OF HEURISTICS AND BIASES

INTRODUCTION 3
A TAXONOMY OF BIAS 3
EVOLUTIONARY PSYCHOLOGY 4
NEUROPSYCHOLOGY 5
SELF DECEPTION 6
HEURISTIC SIMPLIFICATION 12
SOCIAL INTERACTION 24
CONCLUSIONS 28
Introduction

Considering that cognitive skills are so important, we seem to spend

remarkable little time thinking about how we think. Perhaps no where is more
obvious that in the industry in which I work – the financial arena.

Take analysts, these individuals are (supposedly) highly skilled individuals

deeply schooled in the industries they follow. The training courses offered by
HR departments are more likely to focus on presentation and communication
skills, or valuation techniques than on the right way to think.

Even at school few children are ever presented with material on how we
should approach thinking. Indeed many people are take umbrage when the
teaching of cognitive skills is even mentioned, after all surely they can already
think, such an affront to self-image is not generally well received (an example
of one of the self deception biases we will address below).

Despite this reaction, psychologists have spent many years cataloguing the
inaccuracies of our thought processes. This process was inspired by the work
of Kahneman and Tversky (see Kahneman and Tversky (1982) as the classic
reference), and is now the basis of behavioural economics. This paper seeks
to explore the neurological and evolutionary roots of these biases.

A taxonomy of bias

Hirschleifer (2001) suggests that most of the mistakes we make can be traced
to four common causes: - self-deception, heuristic simplification,
emotion/affect, and social interaction. I believe that this taxonomy can be
simplified one stage further. I will argue below that emotion is integral to the
cognitive function, to talk of thinking without acknowledging feeling becomes
impossible under this view. The table below tries to classify the some of the
major biases grouped along the lines suggested by my approach.
 A taxonomy of biases

Biases

Self Deception Heuristic Simplification Social Interaction

(Limits to learning) (Information processing errors)

Overoptimism Representativeness Emotion/Affect Imitation

Illusion of control
Illusion of knowledge

Overconfidence Framing Mood Contaigon

Self Attribution bias Catergorization Self control Herding

(Hyperbolic discounting)

Confirmation bias Anchoring/Salience Ambiguity aversion Cascades

Hindsight bias Availability bias Regret theory

Cognitive dissonance Cue Competition

Conservatism bias Loss aversion/Prospect theory

The challenge in this paper is to explore the three root causes of heuristics
and biases using the insights from both evolutionary psychology and
neurobiology. Before embarking on a detailed discussion some background
on these two approaches may be in order.

Evolutionary psychology
Evolutionary psychology takes the tools and techniques of evolutionary
biology such as fitness and adaptation and uses them to understand why we
our mental processes are the way they are.

The ultimate evolutionary aim for any gene is to ensure its existence in the
next generation. Adaptations are solutions to reproductive problems. For
instance, muscles are an adaptation, and their function is to apply force to
various parts of the body. In general, all members of a species of the same
sex and developmental stage share the same functional organisation (i.e.,
have the same adaptations). All humans have bones, muscles, hearts, eyes,
etc. Adaptations should improve fitness. Fitness is our ability to pass on our
genes, which in the Darwinian scheme of things is the ultimate motivation.
While some problem solving abilities (functions) of the nervous system are
obvious (e.g., vision), many are not; the goal of evolutionary psychology is to
identify all the functions of the cognitive system

Evolutionary psychology seeks to explore the ways in which are minds have
been formed by the process of evolution. Simply put Homo sapiens sapiens
(you and I) have been around for some 120,000 years (itself a mere blink of
evolutions eyes). However, we have lived in an agricultural society for a mere
30,000 years, and an industrial society for a paltry 300 or so years. Our minds
are suited for survival in the evolutionary ancestral environment (effectively
the African Savannah).

Evolutionary psychologists ask us to understand that “Our brains are shaped

for fitness not for truth” to borrow Steve Pinker’s turn of phrase. That is to say
that our minds are best suited to a past environment where the problems we
faced concerned survival rather than the kinds of problem that we face today.

Perhaps the key mistake that evolutionary psychologists must seek to guard
against is pan-adaptism, or the tendency to make up “Just so” stories to
explain every facet of human nature.

Neuropsychology
Neuropsychology attempts to understand how the physical construct of the
brain is related to the cognitive and emotional processes. Part of this work
involves mapping the mind, and periodically we will refer to some of the
findings from this field.

The diagram below outlines some of the main features of the brain. In
particular, I draw your attention to the neocortex, and the limbic system.
These two areas will be of prime importance when we are discussing the
neuropsychology of dual processing systems below.

[Brain diagram here]

Self deception

The first major category of heuristics and bias that I wish to examine comes
under the collective heading of self deception (limits to learning). These
biases are the ones that lead us to believe that we are better drivers than
average. Ask a class of students who will finish in the top half of the class and
around 80% of them believe they will. I’ve asked many audiences of fund
managers over the years if they think they are better at their jobs than
average, and far far more than half believe they occupy such a niche.
Effectively we all like to believe that we inhabit Garrison Keillor’s Lake
Woebegone, where the “women are strong, the men are good looking, and all
the children above average”.

I have labelled this category as limits to learning as well as self deception.

Economists frequently tend to labour under the assumption that learning will
be an unbiased process. However, psychologists generally question this
belief. For instance, a trait known as self attribution bias presents a real
challenge to learning. Self attribution bias refers to situations whereby good
outcomes are attributed to skill, whilst bad outcomes are attributed to bad
luck. If mistakes are categorised as bad luck, what hope have we for learning
from them?

Michael Gazzaniga, a neuroscientist, has shown that we lie to ourselves, the

brain literally weaves a tissue of lies to justify its behaviour. Split brain patients
are individuals who have had their cerebral hemispheres surgically
disconnected as a treatment for epilepsy (the corpus callosum is severed).
Each half of the brain still functions, but there is no longer any communication
between the two.

The controls for language are generally to be found in the left hemisphere.
Most functions of the sensory inputs to the brain are crossed wired, such that,
for instance, the left half of the field of vision is received and processed by the
right hand side of the brain. Gazzaniga (1972) found that showing split brain
patients images to their left eye, and hence their right hemisphere had some
rather bizarre results. The patients generally did as instructed on the card, for
example “walk” or “laugh” were presented only to the left field of vision. The
right hemisphere obliged.

However, when the patient was asked why they walked out of the room, or
started laughing, the left hemisphere starts to make up motives. For instance,
one of the patients asked to walk, when asked why he walked, stated he
wanted to get a coke. When asked why he was laughing the patient replied
“You guys come here and test us every month. What a way to make a living!”.
It should be noted that only the “thinking link” between the patient’s brain is
cut, the emotional link (stemming from anterior commissure- a far older and
deeper hidden part of brain) still functions at a base level.

Perhaps the most bizarre of Gazzaniga’s findings concerned a young man

known as P.S. Unlike most people P.S had language skills in both
hemispheres of his brain. When asked verbally what he wanted to do post
graduation, P.S replied that he wanted to be a draftsman. However, when he
was asked to wanted to do when he graduated but the last word was flashed
to his left eye (and hence P.S’ right hemisphere), P.S. spelt out Automobile
racer using a scrabble set and his left hand (remember the bodies functions
are cross wired).

Nor is it just split brain patients who make up excuses to justify/rationalise

behaviour. Nisbett and Wilson (1977) laid out many pairs of stockings, and
asked ladies to select which pair they liked the most. When the women were
questioned as to the reasons for their selection, they volunteered all sorts of
wonderful excuses about texture and sheerness. However, all the pairs of
stockings were actually identical!

How on earth could self-deception actually prove to be an evolutionary

winner? Two avenues can help explain our natural tendency towards self
deception. Firstly, within communal living, the ability to spot cheaters will be a
useful function.

Homo sapiens sapiens seem to have generally lived in small groups

throughout their history. Indeed, even our evolutionary ancestors such as
Australopithecus seem to have lived in groups. The logic for group living is
obvious within the evolutionary ancestral environment.

The most immediate benefit of communal living is the safety in numbers

aspect, indeed such behaviour is visible within Chimpanzees today. Secondly,
humans were effectively hunter/gather societies. Food was shared out to
smooth fluctuations in the food cycle. Free loaders for protection or food
sharing would be a burden upon the group, hence the ability to spot cheaters
becomes a useful skill.

To demonstrate our skills in cheater spotting Cosmides and Tooby suggested

looking at Wason selection tests. They suggested two forms of the test.

First, look at the four cards below, each is labelled with an alphanumeric
character. If I tell you that if a card has a vowel on one side is must have a
even number on the other side which cards do you need to turn over to see if I
am telling the truth?

E 4 K 7

Before I give the answer now consider the following. You have been
employed at a night-club as a bar manager. However, the club is keen not to
allow underage drinking. If someone is under 18 years old they must not drink
alcohol. Now in the problem below each card is a customer: it says the
customer’s age on side, and what he/she is drinking on the other side. Now
which cards do you need to turn over to check there is no illegal underage
drinking going on in the club?

Drinking 25 years Drinking 17 years

Beer old Coke old

In both cases, the correct answer is the first and last cards only. In the latter
problem this should be obvious – you are looking only at those people
drinking alcohol, and only those people under the legal age for drinking. In the
former problem, these are the only two cards that can prove I was lying (if you
thought E and 4 then you are suffering from confirmation bias, looking for
information that agrees with you, another limit to learning!)

Cosmides and Tooby carried out numerous control tests to ensure that the
framing of the cheater selection problem was at the heart of their finding and
each test confirmed that it was indeed. Effectively, the human race is a group
of walking lie detector machines! However, note the importance of framing.
We find it incredibly hard to see through the way in which information is
presented to us. The brain is effectively modular, if a problem is presented in
a familiar fashion we can solve it, but in another guise we fall flat on our faces.
Hence framing could become the most important bias of all (more on this
below).

Now how does this all relate to self deception? Well, Trivers (1985,2000)
argues that in a world of walking lie detectors one of the easiest ways of
fooling them is to fool yourself. In order to avoid detection we effectively lie to
ourselves. If we don’t conscious know that we are lying then we are likely to
be able to fool those who are seeking to assess such motivations.
For example, the lover saying with all his heart, “I love you more than anyone
else in the world. I will be faithful to you forever”. This message is likely to be
all the more convincing if the lover can conveniently forget that he said exactly
the same thing to someone else a year earlier! Such self deception is likely to
lead to success in mating, and hence the further of genes. In Darwinian terms,
self deception is fitness enhancing.

Of course, knowing the truth could be useful to us, but it is contained in a

walled off area of the brain, hidden from both the conscious part of the brain
and hence other people.

A second evolutionary rational for self-deception comes from the work of

Taylor and Brown (1988). They take issue with psychologists’ usual belief that
somehow a “well adjusted” person engages in accurate reality testing. The
usual short hand definition of mental health is a well-adjusted person is one
who sees what is actually there. Taylor and Brown go on to argue that
“positive illusions – namely unrealistically positive self-evaluations,
exaggerated perceptions of control or mastery, and unrealistic optimism” are
adaptive for mental health and well-being.

Freedman (1978) finds that most people report being happy most of the time.
Around 70-80% of respondents report themselves as moderately to very
happy. Whereas most believe that others are only average in happiness,
whilst fully 60% of people believe they are happier than most people!
Freedman goes on to link high self-esteem and high ratings of control as
correlates of happiness.

Taylor and her various authors have found that certain groups (such as
cancer patients, and AIDS suffers) may benefit from positive illusions, see
Helgeson and Taylor (1993), Reed (1989) and Wood, Taylor and Lichtman,
1985). The belief that one is healthier or coping better than other similarly
afflicted patients is associated with reduced distress.
In general, Taylor finds that a mild degree of self deception as it applies to
self-evaluation and the such like fits far better with psychologists working
definition of mental health. Indeed, those who are classified as mildly
depressed by psychologists seem to lack the positive illusions that dominate
the rest of us. Taylor and Brown point out that these individuals tend to recall
both the positive and negative self–relevant information with equal ease, show
greater evenhandiness in their attributions of performance, and display high
degree of congruence between self-evaluations and external evaluations.
They conclude “In short, it appears to be not the well-adjusted individual but
the individual who experiences subjective distress who is more likely to
process self-relevant information in a relatively unbiased and balanced
fashion.“ So in as much as “mental health” is an important fitness trait, then
self deception once again helps to be a Darwinian winner.

Of course, self-deception can not go unchecked. Triver and Newton (1982)

show how a high degree of self-deception played a major role in a tragic
aeroplane crash. Effectively the pilot of the doomed flight was massively over-
confident and overoptimistic. The co-pilot was clearly highly nervous about the
flight and the prevailing conditions (snow and ice). The pilots self deception
and evasion of reality proved tragically fatal to the passengers of the flight.

Conversations during taxiing prior to take off

Co-pilot Pilot
Detailed description of snow on wings Diminutive description of snow on
wings
Calls attention to danger they face (too Deflects attention to ideal world (de-
long since de-icing) icing machine on the runway)
Asks for advice on take-off Tells him to do what he wants
Source: Trivers (2000)

Wang (2001) also finds that modest self-deception may be a evolutionary

stable strategy. Wang uses evolutionary game theory to study the population
dynamics of a securities market. In his model, the growth rate of wealth
accumulation drives the evolutionary process, and is endogenously
determined. He finds that neither under-confident investors nor bearish
sentiment can survive in the market. Massively over-confident or bullish
investors are also incapable of long run survival. However, investors who are
moderately overconfident can actually come to dominate the market!

Heuristic Simplification

First off I had better explain why I have moved emotion into the heuristic
simplification. Since the times of the Greeks, humans have sought to separate
reason and emotion. Plato opined that passions and feelings prevented us
from thinking. In most religions, emotions are equated with sins. This
approach has dominated the modern world as well. However, there is a
growing group of scholars who argue that emotion and cognition are
intimately related.

For a few moments, let us consider our minds without emotion. We would all
be like Star Trek’s Vulcans, unfeeling thinking machines. Indeed many of
those working in the cognitive sciences tend to proxy our minds using such an
approach.

But minds without emotions are not a good reflection of the human condition.
A machine can be programmed to give a Grand Master a serious run at
Chess (indeed just occasionally even beating the Grand Master). But it can’t
feel pride at the end of the game. It can’t feel joy, happiness or the pain of
losing. A machine can even be programmed to cheat at Chess, but does so
without feeling guilt or remorse.

To understand how humans think we need to understand how emotions

interact with the wider cognitive process. For instance, neurobiologists have
shown that emotions are generally generated via interaction with the body.
The unconscious generator of these emotions is the limbic system (in
particular the amygdala). However, the neocortex also has a role to play in the
conscious recognition of emotion.
Although neurobiologists hate to admit it, the brain’s hemispheres do tend to
look after different functions. Brains are highly advanced pieces of kit, we do
them an injustice when we simplify them too much However, functional MRI
scans do reveal that certain types of task seem to trigger hard wired
responses from the brain.

The left hemisphere tends to be more analytical, more logical, more precise
and is time sensitive and deals with abstract cognition. In contrast, the right
hemisphere is more emotional, dreamier, it processes things in a holistic
fashion, and deals more with sensory perception than abstract cognition.

This fits neatly with the ideas developed by psychologists that we have dual
processing systems within our brains. For a review see Sloman (2002). The
table below lays out the dual system proposed by Kahneman and Frederick
(2002). Effectively, the left hemisphere is more akin to system two, the
reflective process of cognition, whilst the right hemisphere is more closely
correlated with system one, the intuitive approach. Both system are likely to
work in concert, with tasks passing between the two systems. Tasks that
perhaps start out as the subject of system two reasoning, but migrate to be
handled by system one, once they have developed a degree of familiarity.

System One System Two

Intuitive Reflective
Process Characteristics
Automatic Controlled
Effortless Effortful
Associative Deductive
Rapid, parallel Slow,serial
Process opaque Self aware
Skilled action Rule application
Content on which processes act
Affective Neutral
Causal propensities Statistics
Concrete, specific Abstract
Prototypes Sets

Joseph LeDoux, a neuroscientist and gifted writer lays out in clear detail in his
book The Emotional Brain, that the emotion of fear has two neural pathways
akin to system one and system two. The emotion of fear produces one of two
reactions in extremis – flight or freeze. We either run from the threat or we
freeze in the hope of eluding detection by the threat. This emotion seems to
be served by two neural pathways. One fast and dirty, and notably
evolutionarily much older. LeDoux refers to this as the low road.

The danger is perceived (an emotional stimuli) and the sensory Thalamus
processes the information. This information is then sent to two different
centres. On the low road it passes to the Amygdala, part of the limbic system
– one of the oldest parts of our brain. This all happens in the mental
background and requires no conscious thought (system one). However, this
is a pretty unsophisticated processing route, and frequently gives incorrect
conclusions.

These conclusions are held in check in the other road. On the high road, the
Sensory Thalamus sends the information of a threat to the Sensory Cortex
which in a more conscious fashion assess the possible threat, and then send
information to the Amygdala in order to motivate a response.

It is possible that phobias are caused by situations when the high road fails to
kick in. For instance, by significant other suffers from a terrible phobia of
snakes, to the extent that even watching one of television will send her
running from the run, feeling queasy. Could this be a case of the low road
triggering a response, but the high road failing to kick in and reveal that
something on television can’t possibly endanger you?

Let me give you an example where I might be able to prompt your two
different systems to come to different conclusions. It is based on a 1950s
game show, hosted by Monty Hall. Contestants where offered a choice of one
of three doors. Behind two of the doors there was a goat, behind one of the
doors there was a car. Upon selecting a door, the host of the show opens one
of the two doors not selected, revealing a goat. After he has does this, he
offers you the opportunity to switch your choice, what should you do?
The chances are your gut feeling is stick with the door your choose. When
asked to explain this choice, you might say the doors are independent, so the
opening of another door reveals nothing to you.

I have asked this question of some of the brightest people I know, and to a
person I have yet to meet anyone who chooses to switch their choice. Indeed
I have even seen professors of mathematics get heated under collar arguing
that the doors are independent and hence the revealing of a goat is irrelevant.
However, the “correct” answer is that you should switch. Before you throw this
paper away in disgust at my tomfoolery let me try to explain why it is that you
should switch.

The probability that you will chose the correct door initially is 1/3, since there
are three doors each of which has an equal chance of concealing the prize.
The probability that the door Monty Hall chooses conceals the prize is 0, since
he never chooses the door that contains the prize. Since the sum of the three
probabilities is 1, the probability that the prize is behind the other door is 1 -
(1/3 + 0), which equals 2/3. Therefore you will double the chance of winning
by switching

Now your reflective system of thinking can only see the correct answer, but
remember at first you would have sworn that you would stick to your first
choice of door. Your intuitive system was dominating.

Another example of the importance of emotions to cognition comes from the

sorry tale of Phineas Gage. The strange story of Phineas Gage is beautifully
documented in Antonio Damasio’s insight and powerful book, Descartes’
Error.

Phineas Gage was a 25 year old construction foreman working for a railroad
company in New England in 1848. One of his many tasks was to push down
the gunpowder into the blow-hole. However, before this is done the hole must
be filled with sand on top of the gunpowder. On this fateful day, Gage was
distracted and failed to notice that the hole had not been filled, with the
disastrous consequence that he started to drive down the gunpowder directly.

His blows ignited the powder, and the three and a half foot rod he was using
was blown through his head! Damasio writes “The iron enters Gage’s left
cheek, pierces the base of the skull, traverses the front of the brain, and exits
at high speed through the top of his head”. Gage is thrown to the floor,
stunned and bloodied but amazingly still conscious.

Why am I telling you this gory and horrific tale of poor Mr Gage? It is the post
trauma personality changes that are most interesting from our point of view.
Gage went from being a capable, efficient and industrious employee to a
drifter.

Carter (1998) cities John Harlow, Gage’s doctor, describing the new Gage as
“at times pertinaciously obstinate, yet capricious and vacillating, devising
many plans of future operations which are no sooner arranged than they are
abandoned.” Neroulogically speaking, Gage had sustained large damage to
the prefrontal cortex, specifically the ventromedial prefrontal region.

Antonio Damasio has spent large parts of his working life dealing with modern
day equivalents of Phineas Gage. In Descarte’s Error, Damasio describes the
life and times of Elliot, a 30 year old man. Prior to falling ill Elliot was
successful and “well adjusted”. However, he suffered a brain tumour, which
was removed successfully. It had grown just above the midline, in the
prefrontal cortex. Following the surgery, Elliot underwent a major personality
change. He no longer seemed to be the Elliot known to his friends and family.
Damasio describes a typical day for Elliot

Consider the beginning of his day.: He needed prompting to get started in the
morning and prepare for work. Once at work he was unable to manage his
time properly; he could not be trusted with a schedule. When the job called for
interrupting an activity and turning to another, he might persist
nonetheless…Imagine a task involving reading and classifying documents of
a given client. Elliot would read and fully understand the significance of the
material, and he certainly knew how to sort the content. The problem was that
he was likely, all of a sudden, to turn from the sorting task he had initiated to
 reading one of those papers carefully and intelligently, and spend the whole
day doing so, Or he might spend a whole afternoon deliberating on which
principle of categorization should be applied: Should it be date, size of
document, pertinence to the case, or another?

Yet Elliot seemed to pass all the standard tests of memory, and personality
that the psychologists could throw at him. Damasio did note that Elliot had the
unnerving ability to discuss his condition without emotion. It later became
clear to Damasio that Elliot could no longer feel emotion. Damasio became
convinced that Elliot’s emotionless state was intimately connected to his
inability to make decisions.

Damasio has created the somatic marker hypothesis to help explain emotions’
central role in the cognitive process. He describes as the somatic marker as
follows, before you even engage in any kind of cost/benefit analysis (reflective
system two style thought), the brain runs some scenarios, when a bad
outcome connected with a given response option comes to mind (even for the
briefest moment), you experience an unpleasant gut feeling (this is a system
one process in our analysis above). This is the somatic marker.

The marker forces attention onto the negative outcomes, and generates a
warning signal. This signal may lead you to reject the option out of hand.
Effectively it rules out certain paths, protecting you from future loss, and
allowing you to choose among the remaining possibilities. The absence of
somatic markers creates the inability to choose between decisions, because
all are examined in intricate detail, as Damasio found with Elliot.

Damasio and his colleagues devised a clever experiment to see how the
responses of patients with prefrontal cortex damaged compared with normal
people with regard to the creation of somatic markers. Each player was sat in
front of four packs of cards (packs A, B, C, D). Players were given a loan of
$2000 and told the object of the game was to avoid losing the loan, whilst
trying to make as much extra money as possible. They were also told that
turning cards from each of the packs would generate gains, and occasional
losses. The players were told the impact of each card after each turn, but no
running score was given.

Turning cards from packs A and B paid $100, whilst C and D paid only $50.
However, certain cards in A and B resulted in a major loss, sometimes as
much as $1250. The equivalent losses in packs C and D were much smaller,
an average of $100. These undisclosed rules were never changed. The
duration of the game was 100 turns, although this information was also
withheld from the players.

When normal people played the games, they started to sample each pack.
Then presumably lured by the big payoffs started to use A and B more and
more. However, within the first 30 moves, they have switched their preference
to the lower packs C and D. The very high cost of cards in A and B seems to
deter normal players.

When players will damage to the prefrontal cortex played the game, very
different outcomes were observed. They tended to concentrate on packs A
and B, regardless of the large losses incurred. In fact, in most games, by the
halfway point most of these players had gone bankrupt.

Effectively, the prefrontal damaged players seem to lack the ability to create
somatic markers for avoiding the high risk packs. Although they are still
sensitive to both punishment and reward, they can’t create the associations
necessary for avoiding the tendency for the most immediately rewarding
option. In some sense. they have lost their self control, and their ability to
make decisions.

Emotion seems to be central to our ability to actually make decisions. LeDoux

writes “While conscious control over emotions is weak, emotions can flood
consciousness. This is because the wiring of the brain at this point in our
evolutionary history is such that connections from emotional systems to the
cognitive systems are stronger than connections from the cognitive system to
the emotional systems.”

A small (but thankfully vocal) group of psychologists and economists have

been pursuing the role of emotion in the generation of heuristics and biases.
Two very recent and excellent examples of this approach are Loewenstein et
al (2001), and Slovic et al (2002).

For instance, Loewenstein et al (2001) write

Responses to risky situatios (including decision making) result in part from direct (i.e.
not cortically mediated) emotional influences, including feelings such as worry, fear,
dread, or anxiety...feeling states are postulated to respond to factors...that do not
enter into cognitive evaluations of the risk and also respond to probabilities and
outcome values in a fashion that is different from the way in which these variables
enter into cognitive evaluations. Because their determinants are different, emotional
reactions to risks can diverge from cognitive evaluations of the same risks.

Whilst Slovic et al (2002) write

Images, marked by positive or negative affective feelings, guide judgement and

decision making. Specifically, it is proposed that people use an affect heuristic to
make judgements. That is, representations of objects and events in people’s minds
are tagged to varying degrees with affect...affect may serve as a cue for many
important judgements.

Imagine a situation where you can win a prize by taking a red jelly bean from
a jar. When presented with such challenges participants often preferred to
draw from a bowl containing a higher absolute number, but a smaller
proportion, of red beans (e.g. 7 in 100) than from a bowl with fewer red beans
but a better probability of winning (e.g. 1 in 10).

Slovic et al interpret this as suggested that “images of 7 winning beans in the

large bowl appeared to dominate the image of 1 winning bean in the small
bowl...consistent with the affect heuristic, images of winning beans convey
positive affect that motivates choice”.

Why are the emotional connections dominant in an evolutionary setting? The

answer seems obvious. The emotions are more important to our survival than
the pure cognitive process. Think about the emotion of fear example that I
explored earlier. If the system one response is faster (albeit inaccurate) it will
keep us safe. Yes, it may lead us to some false positives in statistical
parlance, that is to say, it may identify some situations as hazardous that
actually are innocuous. However, false positive rarely kills in this context. It is
better to be safe than sorry or the quick and the dead if you prefer. LeDoux
has shown that in rats the reaction time of the “low road” is half of that of the
“high road”. Hence we have become evolutionarily tuned to listen to our
system one responses.

What of the other heuristics and biases outlined under the heading of heuristic
simplification? It strikes me that economists devotion to rationality is bizarre.
After all economics is a science concerned with the allocation of scare
resources between competing claims. Our mental capacity is limited, so we
need to allocate over many tasks.

Economists should be all too familiar with the concept of maximising subject
to constraint. In this case, our constraints are our limited mental capacity
ranging from memory, to attention and perception. So surely an economist
thinking about thinking would suggest that some form of limited rationality is
the proper way to model the mind, rather than blithely assuming the Vulcan
like logic ability that is standard (however, unobtainable!)

For instance, limited attention can help explain saliency effects, anchoring,
and slow adjustment. That is to say, because we as humans have a bound on
our ability to pay attention we will find ourselves occasionally drawn to things
that shouldn’t concern us (saliency effects), when we find such things
capturing our attention we will tend to hold onto them (anchoring effects).
Once we have anchored we will adjust away from this benchmark only very
slowly.

Evolution has not created us to be machines, it has driven us to maximise our

fitness. In order to do this it has placed emotions at the very centre of our
thought making process. Plus we should not think of ourselves as machines
with boundless capacity to calculate and optimise. Indeed “economics” would
suggest a far more modest solution than total rationality…if only economists
would follow the logic of their own discipline!

I admit I have strayed far from the evolutionary basis on which I started. So it
is time to return. Why is it that psychologists such as Kahneman and Tversky
have uncovered such a wide range of common errors in our thinking patterns?

The simple answer is often that we simply don’t understand probability very
well. We as a species are generally probability blind. Probability in its current
form really only surfaced during the eighteenth century thanks to the
Reverend Thomas Bayes. That is a mere nanosecond on an evolutionary time
scale. Our brains simply have evolved to think in probabilistic terms. Against
the backdrop of the evolutionary ancestral environment would we have
needed to deal with any form of probability? We just won’t have any use for
such a skill.

Just as we saw with the Wason selection test used by Cosmides and Tooby,
the presentation of the data matters. Virtually everyone can solve the Wason
selection test when it is framed as a cheater detection test, but put it into a
different format and only around ¼ of people can solve it.

Some psychologists (so called ecological rationalists) seem to think because

we can solve problems when they are presented in one form, then we
shouldn’t worry about the errors stemming from solving similar problems in
different formats – that biases aren’t really biases.

I would disagree. Our minds are modular. Each module is adapted for some
purpose. However, when we don’t recognise the problem as coming form that
particular class we find it hard to solve. This seems to be what happens in
many of the biases that result from heuristic simplification.
Lets start with an example of probability blindness. Consider the following
(taken from Gigerenzer (2002)):

The probability that a woman has breast cancer is 0.8%. If a woman has
breast cancer, the probability is 90% that she will have a positive
mammogram. If a woman does not have breast cancer, the probability is 7%
that she will still have a positive mammogram. If a woman has a positive
mammogram, what is the probability that she actually has breast cancer?

If you were a perfect Bayesian you would immediately come up with the
following formula:

P(disease|positive)=(P(disease)P(positive|disease)/(P(disease)P(positive|dise
ase)+P(no disease)P(positive|no disease))

No wonder we are probability blind!

In numbers:

(0.008*0.9)/(0.008*0.9+0.992*0.07) = 9%

Gigerenzer point out that if we express the problem in natural frequencies we

can solve it simply. The problem becomes:

Eight out every 1,000 women have breast cancer. Of these 8 women with
breast cancer, 7 will have a positive mammogram. Of the remaining 992
women who don’t have breast cancer some 70 will still have a positive
mammogram. Imagine a sample of women who have a positive mammogram.
How many of these women actually have breast cancer?

In natural frequencies Bayes Law simply becomes

No. of true positive tests / (no. of true positive tests + no. of false positive
tests)

In numbers:

7/(7+70) = 9%

Natural frequencies have the advantage that base rates are automatically built
into the calculation which simplifies Bayes’ Law no end. Indeed it is easy to
make a case that stats teachers could improve their classes understanding
(and ease their own pain at teaching Bayes’Law) if they taught people to
reframe probability questions into natural frequency problems.

Moving from probabilities to natural frequencies can also alleviate the

conjunction fallacy (part of the representativeness heuristic). The original
formulation (Tversky and Kahneman, 1983) is:

Linda is 31 years old, single, outspoken and very bright. She majored in
philosophy. As a student, she was deeply concerned with issues of
discrimination and social justice, and also participated in antinuclear
demonstrations.

Is it more likely that Linda is a bank teller

Or
Is it more likely that Linda is a bank teller and active in the feminist
movement?

In general, most people go for the second option (around 85% of participants
in actual fact!) The same problem can be expressed in natural frequency
terms as follows:

Linda is 31 years old, single, outspoken and very bright. She majored in
philosophy. As a student, she was deeply concerned with issues of
discrimination and social justice, and also participated in antinuclear
demonstrations.

There are 100 people who fit the description above. How many of them are
bank tellers?
bank tellers and active in the feminist movement?

Hertwig and Gigerenzer (1999) find the effect of expressing the problem in
these terms is dramatic. They report moving from 80-90% conjunction
violations when the problem is expressed in its first format to 10-20%
conjunction violations when it is expressed in the second format.

So why are natural frequencies natural to us? What was it our the ancestral
evolutionary environment that drove to us to be capable of dealing with
natural frequencies?

The very nature of our origins suggests why we might find natural frequencies
easier to deal with. Imagine a human in the ancestral evolutionary
environment, remember these people were largely hunter-gather groups. Like
all animals, a large proportion of each day would have been devoted to
feeding. As our early humans went from day to day they would have been
sampling potential food sources, and learning the cues (signals of potential
food sources such as certain types of vegetation). This is nothing other than
natural sampling, the updating of frequencies from observation to observation.
Natural frequencies report the “to date” tally of the natural sampling process.
Hence counting the number of times you got ill from eating a certain plant, or
finding a food source close to a forest would have improved your fitness.

Social Interaction

The final source of biases identified at the outset was those concerning our
social nature. In particular we will be looking at imitation and the role of
culture. By culture I mean simply an inherited stock of knowledge that is
transmitted from one generation to the next.
There are many examples of culture in this sense, and indeed imitation in the
animal kingdom. For instance, the other day I was watching David
Attenborough’s Life of Mammals. The particular episode I was viewing
showed how a herd of elephants were passing on their culture to the next
generation. The elephants in question were from Mount Elgon in Kenya. In
order to obtain vital salts these elephants follow a most incredible journey.

Elephants for centuries have visited a cave here. They boldly walk into its
depths, along a passage so long and winding that no natural light reaches far
into it. In any case, the elephants usually visit the cave at night…Elephant
calves usually stay close to their mothers and so they too walk deep into the
caves…But it is important they make the journey, so that they will learn the
route into the cave and be able to maintain the tradition. (Attenborough,
2002)

Imitation serves not only to transmit information vertical through the

generations, but also transmits information horizontally through the social
group.

Nor is the role of imitation restricted to so called higher order animals. Lee
Alan Dugatkin has spent an inordinate amount of time studying guppies. Even
guppies with brains the size of pinheads show signs of imitation. In particular
Dugatkin (2000) shows that in mate selection in guppies imitation can be a
highly powerful force. He finds that female guppies are pre-disposed towards
males with a more orange colouring. However, he also finds that there is a
marked tendency for female guppies to imitate each other. In that so long as a
male has a threshold level of orange colouring, females will tend to prefer
males which other females had chosen to mate with. Guppie culture at its
best!

Laland et al (1996) use a mathematical analysis of population genetics

models too explore when natural selection should favour horizontal social
learning. They find that two key variables transpire to be (i) the probability that
a naïve forager will successfully locate a highly nutritional but patchily
occurring food source (ε) and (ii) the rate at which the environment varies (e).

High
Individual
learners
only
Learners
Source: Laland et al (1996)

Environmental variability in this model is defined at the rate of daily or more

frequent foraging trips. So even very low levels of e can indicate rapid
environmental changes. In general Laland et al suggest that social learning
can evolve in a rapidly changing environment when the likely success of a
forager is also low either because individuals can only search small areas of
the population range or because the food source is very widely distributed.

Dugatkin (2000) points out that social learning is much faster than natural
selection. Natural selection works over multitudes of generations, whereas
social learning spreads more like a virus. Because of this differing speed of
transmission, Dugatkin argues that genes are more likely to dominate in a
stable environment, but when the world around us is changing rapidly then we
are more likely to witness social learning becoming the dominant feature. This
certainly makes sense in terms of the increasing frequency with which we
have witnessed the occurrence of bubbles in financial markets over recent
years.

Could are brains have evolved to listen out for gossip? Could this explain why
we are so prone to falling for rumours? Steven Pinker, one of the shining
lights of the evolutionary psychology approach argues that gossip played a
vital role in the evolutionary ancestral environment. He writes “Gossip is a
favourite pastime in all human societies because knowledge is power.
Knowing who needs a favour and who is in a position to offer one, who is
trustworthy and who is a liar, who is available…and who is under the
protection of a jealous spouse…- all give obvious strategic advantages in the
games of life. That is especially true when the information is not yet widely
known and one can be the first to exploit an opportunity, the social equivalent
of insider trading.” (my italics).

Not only is social learning likely to have emerged from our evolutionary past
via genetics, it may also have arisen from the existence of a second
replicator. This will need a little explaining. Genes are the primary replicator,
that is to say genes are trying to reproduce themselves in each subsequent
generation (see Dawkins, 1976). A replicator must meet three criteria (i)
fidelity (good copies are made), (ii) fecundity (lots of copies are made) and
longevity (copies are made for a long time). Dawkins suggested the possible
existence of a second replicator in the final chapter of his masterpiece, The
Self Gene. He referred to this second replicator as a meme.

The Oxford English Dictionary defines a meme as “An element of culture that
may be considered to be passed on by a non-genetic means, esp. imitation”.
Memes are effectively contagious ideas.

Meme’s have now taken on a life of their own (a mimetic meme, if you like).
Daniel Dennett (the America philosopher) has adopted memes as the corner
stone of his approach to consciousness (see Dennett (1991,1995)). For a
book length treatment of the meme readers can do no better than Blackmore
(1999).

Once we accept that meme are a second replicator then we can stop thinking
that cultural transmission is always selected by genetic fitness considerations.
Meme are interested in making more copies of themselves, and ensuring their
survival into the next generation, in a fashion similar to genes, but with
condiseration to mimetic fitness rather than genetic fitness.
Memes are a powerful tool for understanding much that doesn’t make sense
in terms of genetic fitness. For instance, a religion that enforces celibacy upon
its preachers it clearly at odds with genetic fitness, as there can be little hope
for the survival of genes to the next generation. However, in terms of mimetic
fitness having a dedicated mouthpiece (without the distraction of sex) is surely
a key survival strategy.

Evolutionary psychology argues that are minds are domain specific to our
past environment. When we act in maladaptive ways today, it is simply
because our brains aren’t tuned to handle the world in which we find
ourselves.

Accepting the role of memes as a second replicator complicates matters.

Memes have effectively co-opted a ride on our evolutionary ability to imitate.
The ability of humans to communicate is central (Pinker, 1994) to our
evolution. Indeed Diamond (1992) argues that the “Great Leap Forward” in
terms of evolution was the creation of language (and accounts for why we
outmanourved the Neanderthals, who contrary to popular opinion seemed to
have larger brains that us!).

Once we have speech, and the ability to imitate then the possible role of a
second replicator emerges as a major evolutionary force. This in turn means
that we are faced with the possibility that maladaptions are in fact not
maladaptions but rather the result of memes lurking in our minds.

Conclusions

I would argue that both meme and genes have a role. In terms of the
foundations of heuristics and biases I find the evidence of evolutionary
psychology compelling. The way we think is largely determine by our past.
That said, memes have a large role to play in many areas of social interaction.
Given the rapidity with which the world is changing, the role of social learning
may become dominant in the future. In order to understand future
developments a good understanding of our past, and memes is likely to be
key.

Can anything be done to mitigate the maladaptions that we currently find? As

we have shown above, framing is perhaps the key problem we must
overcome. This in turn suggests that we need to spend far more time teaching
our children how to think, and think critically (if memes are to be exposed).
However, debiasing is always easy said than done!
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